Airline Credit Cards

Understanding Airline Credit Cards

Airline Credit Cards are certainly becoming more common with the major airlines and even some of the low budget airlines now offer them. The credit cards are also becoming more popular with travellers and there is a good reason for this. I guess the fact that you can actually receive something back for the money you spend is certainly an appeal for many, regardless how big or small the rewards may be.

The reality is simple! If you are going to be spending money purchasing products and your purchases are going to be made on a credit card, then you may as well get something back for your efforts!

If you enjoy travelling and can make your credit cards work for you, then an airline branded credit card could be the ideal credit card to use. However, airline credit cards are not for everyone and you really do need to ensure you have chosen the right card to suit your requirement. Choose the right card and you could be enjoying free flights, upgrades and other small luxuries but if you choose the wrong card, it will be hard to see any benefits or rewards from using it!

Hopefully, this short guide will help you decide whether or not an airline credit card will be beneficial to you.

What Are Airline Credit Cards

Basically an airline branded credit card is a credit card that rewards you for using it. However, unlike a cashback credit card, an airline credit card rewards you in air miles or points (not cash) that can then be redeemed for air miles. These can then be redeemed towards free flights, upgrades partial payment for a flight.

How Can You Spend Your Air Miles

Once you have accumulated a certain number of air miles, they can then be used to pay for flights with the airline to which your credit card is branded. You can usually put all your air miles towards a free flight or you can use a certain number of air miles towards a flight along with a set cash fee. These flights are commonly known as ‘Reward Flights’.

Many reward schemes now allow you to top up your existing air miles with air miles from other air miles reward schemes that are participating in the same scheme. If you do not have enough air miles for your desired destination, this can be a really useful method to use.

However, the amount of air miles you need for a free flight can be considerable but what you have to remember is that if you are using your credit on a regular basis, these are air miles you would not have received normally, if you didn’t have an airline branded credit.

Using Your Air Miles Or Points

Many airlines will put a time limit or restriction on when you can actually use your air miles and for which flights you can redeem your air miles. This is why it pays to be flexible with your travel dates to ensure you get the best deals possible from your air miles.

You should check to see if the airline does have any restrictions on the time limit to which you can redeem your air miles or travel and try to redeem them before the deadline expires, as you may lose them if you fail to do so.

Advantages Of Airline Credit Cards

If you are a frequent flyer with a certain airline and they have their own branded credit card, there can be several advantages of having one of their cards. As we mentioned earlier, if you spend a lot of money on your credit cards and currently receive no rewards for doing so, then you may as well have a credit card that does reward you for spending on it!

However, as we mentioned earlier, you should only have one if you can ensure you can afford to pay of the full statement amount each month.

Most airlines will reward you in air miles that can be redeemed on flights and some also have additional benefits for their members. Benefits such as companion flights, upgrades and free access to their Airport Lounges are just a few additional benefits that you can enjoy once you have an airline branded credit card.

Many of the reward schemes give you a certain number of air miles or points simply for just applying, whilst others run special offers throughout the year for their card holders to take advantage of.

Disadvantages Of Having An Airline Branded Credit Card

All credit cards having fees and charges if you fail to pay off the minimum amount each month. Even if you do just pay the minimum amount each month, you will still pay an interest fee. Some of the branded cards can have a much higher APR than others and you should only use one of these cards if you can afford to pay off the full amount each month. If you cannot and you incur the interest charges, then these will far outweigh the cost of any rewards you receive for using the card.

Some of the cards may charge you to join and if they do, you should calculate whether or not it is worth your while paying the fee against how much you will save using the card.

Always Read The Small Print

All credit cards ‘Terms And Conditions’ vary and before you apply for any card, you should always make sure you are familiar with the ‘Terms And Conditions’ of that specific card. Charges and interest rates do vary and also the entitlements of your rewards can vary too. There may be certain stipulation on redeeming your air miles which you should make sure you are aware of, such as surcharges or taxes that may not be included in flights purchased with airmiles.

Finding The best Airline Credit Card

Only you know your own financial situation and if you are sure that you will be able to pay off your credit card statement in full each month, then all you need to do is find the best deals to suit your requirements.

Firstly, you will need to look for the credit cards that best suit the way you purchase and also the way you wish to travel.

Check to see how many air miles you will earn on your spending. The amount you earn will vary between credit cards and airlines and you should aim to choose the one that will benefit you the most and offer you the most rewards for the airlines you fly with.

Although the amount of air miles you earn may vary between credit cards and airlines, so to do the distances that you can travel when redeeming you air miles. This is why you must compare all cards to see which one provides you with the best package for ‘air miles earned’ and the destinations and flights those air miles can be used

Check to see if any of the credit cards offer bonus air miles when you join the scheme, as these can significantly help towards your first flight. (However, if they do, just check to see if these bonus air miles have an expiry date on them as some need to be used in a certain time scale).

Summary

If you are a frequent user of your credit cards and pay the full amount of the bill off each month, then you may as well get something in return for your spend and purchases. Also if you intend applying for an airline credit card, check the ‘Terms and Conditions’ and ensure you are familiar with the small print. Surcharges and the APR tend to be higher on the airline credit cards so make sure are confident you can pay of the full amount each month.